Rice commented, "Anthem expects its 2017 earnings to grow modestly versus its 2016 EPS outlook of "approximately" $10.80. In 2017, the company sees tailwinds to its earnings coming from a) Enrollment gains across Medicaid, Medicare (with Y/Y stable margins), selffunded businesses etc; b) Margin improvement in the individual ACA compliant and the Iowa Medicaid business; c) The impact of the one year HIF moratorium on the commercial biz; and d) potential capital deployment. 2017 headwinds include a) onetime SG&A cuts which benefited 2016 come back in 2017; b) enrollment and margin pressure due to a shift to ACA compliant offerings in the local group biz; and c) rate pressure in the Medicaid expansion business. Finally, Anthem is in the process of updating its LT growth plan and may revisit its 2018 EPS target of $14/share."

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